David Weigel: President may have escaped a crisis, but at a massive cost to his party

Monday 1 August 2011 23:00 BST

Click to followThe Independent Online

Their faces told the story. When they joined Democrat majority leader Sen. Harry Reid for the announcement of the final debt limit deal, a few of his peers stood slumped, their faces bearing large frowns. Reid shook hands with his opponent, Republican leader Mitch McConnell, who was wearing his version of a grin. Democrats, who control the presidency and the upper house, looked like losers. This was because they'd lost.

How can we say that? Hasn't President Obama just Houdini'd his way out of another crisis? Hasn't he just sealed a deal that prevents default and, hopefully, a downgrade of America's bond rating?

He has, yes, but at a massive cost. This debt deal is a gun-to-the-head recanting of everything Obama and his Democrats say they believe in. They say – and economists agree – that the economy is slumping and there shouldn't be spending cuts. But this deal cuts billions. They pledge to protect Medicare, and voters like that about the Democrats. But this deal includes a "trigger" that cuts payments to Medicare providers unless a new congressional committee – which could also cut Medicare – comes up with a plan by Christmas.

There's more, but the upshot of this deal is that Democrats were forced into a hostage situation by Tea Party activists and Republicans who didn't believe the debt limit needed to be raised. And then the Democrats shot the hostage. "This deal weakens the Democratic Party as badly as it weakens the country," grumbled Rep. Raul Grijalva, a punchy Arizona liberal. "We have given much and received nothing in return." He is hard to argue with.

As the deal gets sold today, White House advisers and sympathisers argue that voters are going to look kindly on the President's position. According to Gallup, while Americans soured on every Washingtonian during this standoff, they soured on Obama the least. Bill Clinton responded to Newt Gingrich's rebellion by "triangulating", and voters rewarded him. Surely they'll reward Obama.

That's not at all certain. When Bill Clinton was winning his standoffs, unemployment had tumbled below 6 per cent and was still falling. Unemployment today is at 9.2 per cent and rising. This deal will only benefit the President if the economy recovers. How do we know? In November, he agreed to an extension of tax cuts and unemployment insurance – triangulation. In March, he and House Republicans avoided a government shutdown by cutting spending – triangulation. Voters haven't rewarded him. They're saving that for when the economy recovers.

Until then, Obama has mollified Republicans for a little while at the cost of outraging the most engaged liberal activists. In eight days, Wisconsin Democrats are fighting for three state Senate seats. Activity like this, at the state level, is what's giving liberals the most hope. We'll know soon whether the President's compromises have made them even more dedicated, or whether they've sent them spiralling into depression.

David Weigel is a contributing editor at Reason and political reporter for Slate